Food trucks may be ubiquitous in the city, but most are not making enough dough to survive on street food alone. Some, like the popular Mexicue, have recently abandoned the daily grind, shifting gears to focus on more lucrative catering gigs, brick-and-mortar eateries or even wholesale products sold in grocery stores.

The hip industry, which hit New York City about seven years ago with its flashy trucks and foodie crowds, is going through a midlife crisis. Many of its founding members are graduating to grown-up endeavors that offer more financial stability. Others supplement their incomes with part-time jobs in real estate or personal coaching, for example. Even David Weber, president of the three-year-old New York City Food Truck Association, no longer owns food trucks.

"It was too hard on me," said the new father and former partner in Rickshaw Dumpling Bar. "The trucks break down easily, and then it's incredibly stressful because you and your employees are not making money."

Mr. Weber is now the chief operating officer of Architizer, an architecture and design firm, though he still heads the food-truck association and does advocacy work for the industry.

The challenges trucks face are many: bad weather, parking regulations that prohibit vending on many city streets and the difficulty in getting permits from the city's Department of Health, to name just a few. The Department of Health has issued 5,100 mobile-food-vending permits, which include trucks and food carts; just 500 belong to food-truck operators. Mr. Weber estimates that the vast majority of those are soft-serve ice-cream businesses, while just 100 are the new breed of artisanal trucks serving high-quality cuisine. That number has remained flat for a couple of years.

Moving up the food chain

Photo: David Schillace

The Department of Health has issued 5,100 mobile-food-vending permits. Just 500 belong to food-truck operators.

Food trucks are hardly disappearing from the city landscape, however. Those who are in it for the long haul—like James Klayman, owner of Gorilla Cheese NYC, which specializes in all things grilled cheese—say operators compete as intensely as ever to find prime parking spaces, especially in midtown, with its dense lunch crowds.

"We leave at 4:30 a.m. to get a spot on the street, but now I can't get to the space where I've been parking for the past 18 months because others are leaving at 3:30 a.m.," Mr. Klayman complained.

Rather than leave street vending, Mr. Klayman is beefing up his catering business after seeing declines in lunch sales because of competition. He also keeps his hand in commercial real estate as a broker for United Realty Advisors.

"Four years ago, you went out on the street and made good money," said Derek Kaye, owner of Eddie's Pizza Truck. "Now you have to offset the [vending] with other things." Mr. Kaye has a side gig in student travel.

Others have decided to move up the food chain.

The daily tweets informing New Yorkers where to find the Mexicue food truck started to dwindle early this year, and by March there were none. Without fanfare, Mexicue's owners decided to stop street vending altogether—except for special events like concerts. The four-year-old taco company is focusing instead on opening restaurants, with its second one slated to debut in Times Square in June and a third to launch in October at 225 Fifth Ave. (The first one is in Chelsea, at 345 Seventh Ave.)

"We used the truck to build the brand," said co-founder David Schillace. "Our restaurants are going to make $3 million a year with $500,000 in profits. You can't do that kind of business on a truck."

The turning point for Mexicue was bagging a big investor, Ruby Tuesday founder Sandy Beall, who took a 25% stake last summer.

In December, 10-year-old Rickshaw Dumpling shuttered its entire business. It started out as a traditional quick-service restaurant, but in 2008 jumped on the truck craze, eventually expanding to as many as four vehicles. Mr. Weber bowed out before the business closed. Founder Kenny Lao could not be reached for comment, but industry insiders said rising rents as well as the hassles of vending on the street persuaded Mr. Lao to abandon his trucks and close his two stores.

These days, the aptly named Green Pirate Juice truck spends four days a week on the 12th floor of the industrial-style Starrett-Lehigh Building at 601 W. 26th St.—yes, it drives right into the service elevator—where it serves freshly squeezed juices to the mostly fashion-designer tenants. The rest of the time, it's hired for events by Silvercup Studios, concert promoters and others.

When it started out in 2008, Green Pirate brought in between $40,000 and $60,000 in the period from April to October, not nearly enough to support its two co-founders, who moonlighted as masseuses and personal health coaches.

"The lifestyle necessary to run a street vending business was not for me," explained co-founder Deborah Smith. "I was trying to teach others how to live a healthy life and reduce stress, and I had so much fear about the business."

Ms. Smith stopped daily street vending several years ago and is now building a wholesale business, bottling juices and selling them in grocery stores, much as the Coolhaus ice-cream truck is doing.

'Who we are'

Los Angeles-based Coolhaus operates two trucks and a cart in New York, but the majority of its revenue now comes from its packaged ice cream, which is sold by Whole Foods, Fairway, Gourmet Garage and other grocers.

"I would not recommend getting into the food-truck business unless you have a bigger plan—starting a restaurant or a consumer-product line," said Chief Executive Natasha Case.

The industry still captivates entrepreneurs and will likely attract even more interest with the just-released Chef, a film starring Jon Favreau, who plays a celebrity chef who loses his restaurant job and starts a new career running a food truck.

Mexicue's founder remains attached to his food truck, despite a new direction and fresh capital for his business. He doesn't want to get rid of it. "My life savings went into that truck," said Mr. Schillace. "The truck is part of who we are. It launched us."

Clarification: David Weber, president of the New York City Food Truck Association, continues to be actively involved in the industry though he no longer owns food trucks. The amount of time he devotes to the industry was unclear in an earlier version of this article originally published online May 11, 2014.